Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

Discovery Wades Into The Streaming Waters

By The Daily Upside - Dec 2, 2020 at 5:19PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Is there room for another player?

For more crisp and insightful business and economic news, subscribe to The Daily Upside newsletter. It's completely free and we guarantee you'll learn something new every day.

Soon there will be another way to watch hyenas and lions do battle in the Serengeti.

Discovery, the owner of HGTV, Food Network, and Animal Planet, will launch its streaming service "Discovery+" on January 4th.

Back To Reality

Without the same breadth of content as its streaming brethren, Discovery+ will debut at just $4.99 per month ($6.99 for an ad-free experience).

To stand out in the increasingly crowded streaming jungle, Discovery is banking on reality television:

  • Discovery+ will build on its library of content (think Shark Week) and create new content with big-name personalities such as Chip and Joanna Gaines (Fixer Upper) and Guy Fieri (anything and everything edible).
  • The platform will be available in 25 countries by the end of next year and has rights to stream Olympics coverage to subscribers in Europe, should that ever prove relevant again.

Distribution: Discovery is taking one straight out of Disney's playbook by partnering with Verizon to give its users free access to Discovery+ for one year. A similar arrangement with Verizon and Disney contributed roughly 20% of subscribers in the early days of Disney+.

Discovery CEO David Zaslav has called Discovery+ "the most important thing we'll do as a company since I've been at Discovery." Investors seemed to agree-shares were up 2% on the day.

But Will It Work?

Much has been written about how the streamlining landscape has become oversaturated. Quibi recently learned that the hard way.

Bad Fact Pattern: As of June, according to the TV and movie data collection site, the major streaming services had nearly 1,000 reality TV shows in their catalogs.

Better Fact Pattern: Niche streaming services have managed to build loyal audiences. Crunchyroll, which caters to anime fans, has 3 million subscribers. The WWE network has more than 1.6 million subscribers.

And in theory, there is room for more players.  Subscribing to Netflix, Hulu, Disney+, AppleTV, HBOMax, Peacock, and Discovery+ would cost just under $60 per month. That's still less than half the average US monthly cable bill.

The Takeaway: Keep your eyes peeled for The Daily Upside+ launch in the near future.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 11/30/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Our Most Popular Articles

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.